Refer to the accompanying table. Based on their comparative advantages, Pat should specialize in ________, and Corey should specialize in ________. Pizzas Made Per HourPizzas Delivered Per HourCorey126Pat1015
A. neither making pizza nor delivering pizza; both making pizza and delivering pizza
B. delivering pizza; making pizza
C. both making pizza and delivering pizza; neither making pizza nor delivering pizza
D. making pizza; delivering pizza
Answer: B
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An increase in government purchases will increase aggregate demand because
A) the decline in the interest rate will increase demand. B) the decline in the price level will increase demand. C) consumption expenditures are a component of aggregate demand. D) government expenditures are a component of aggregate demand.
Refer to Figure 2-4. A movement from ________ is the result of additional government restrictions on the pollution that results from plastic production
A) Z to W B) X to V C) X to W D) Z to Y
Orange juice drinkers want to consume more orange juice at a lower price. Which of the following events would have this effect?
A) a decrease in the population B) a decrease in the price of orange juice processing C) an increase in the cost of fertilizer used for orange groves D) a decrease in income, assuming orange juice is a normal good
Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower